Better-than-expected Q1 performance confirms the effectiveness of the transformation, Goldman Sachs Group, Inc. raises the target price of Advance Auto Parts (AAP.US) to $48.

Goldman Sachs Group, Inc. has raised its target price for Advance Auto Parts (AAP.US) from $43 to $48 while maintaining a "neutral" rating. This adjustment is based on the company's first-quarter performance both revenue and profit outperformed market expectations. Goldman Sachs Group, Inc. points out that Advance Auto Parts' transformation strategy is beginning to show results, and its impressive quarterly performance is strong evidence of this. The company announced its first-quarter fiscal 2025 earnings report on Thursday, with an adjusted loss per share of 22 cents, better than the analyst consensus estimate of an 82 cents loss. Quarterly sales were $2.583 billion (a 6.8% year-over-year decrease), exceeding the market's forecast of $2.499 billion. Comparable store sales for the first quarter of 2025 decreased by 0.6%. Following the announcement, Advance Auto Parts surged by 60% to $50.04. According to the research report, Goldman Sachs Group, Inc. observed that management's efforts to improve operations are beginning to bear fruit, and momentum is building. The fundamentals of the retail automotive parts market remain robust, and price trends show growth potential. The firm believes that as a defensive industry, this sector has resilience in turbulent market environments. While still cautious, Goldman Sachs Group, Inc. has stronger confidence in the company's strategy amid expectations of stabilization and improvement in the industry background. This $5 increase in the target price highlights positive expectations for its operational execution improvement. In addition to Goldman Sachs Group, Inc., TD Cowen has also raised its target price from $40 to $53.